an Australian firm that owns, develops, and manages shopping
centers in the United States and around the world, has a subsidiary
(Westfield Labs) that is currently testing beacon technology for
possible use in its locations across the world.

“You’re going to have retail properties going gaga for this,” says
Kerley. “You’ll be able to demonstrate what the foot tra;c is like
at certain times of day, and what parking is available, and just flow
that information to them on their smart devices.”

SMART ISN’T ALWAYS SAFE

In a Ray Bradbury short story, published by Colliers in 1950, a fully
automated house burns to the ground, despite all the technology
designed to keep it safe. Bradbury’s story was a comment on
nuclear proliferation rather than the perils of home automation,
but the idea that technology requires human oversight is more
resonant than ever. If a smart home energy system decides that
the best time to wash your clothes is when you’re away from home
or asleep, does it put you at risk?

Alex Filip is deputy communications director for the Consumer
Product Safety Commission, which is closely monitoring smart
product designs. Filip says a potentially unsafe product is just as
risky when consumers push the start button as it is when triggered by automation. “Whether you start your car, slow cooker, or
furnace remotely is not an issue unless [it] behaves in an unsafe
manner,” Filip said in an e-mail to REALTOR® Magazine. The agency
already cautions against operating certain household appliances,
including clothes dryers and dishwashers, when no one is home
or awake. That warning will continue to apply as smart versions of
those products are rolled out.

“In the Internet of Things, the expectation is that your smoke
alarm and kitchen camera would signal your phone if there were an
issue. We are not all in that future yet. Hopefully the hazard will stay
in science fiction,” he says.

One common fear for consumers is that their house could be
hacked into the same way e-mail and credit card accounts are
today. Not only could thieves gain physical access to the home, but
they could also be privy to a large volume of information about the
owners that might be stored on devices or in the cloud. McCaughey
says individual homes would be less appealing to hackers than the
prospect of a wider invasion involving “a back door that is known to
all hackers,” putting all consumers who own a vulnerable product
at greater risk.

At least one example of a breach has prompted action by theFederal Trade Commission. In February 2014, the commissionsettled charges against TRENDnet Inc., which makes security cam-eras that can be monitored via the Internet. The company had notsecured passwords or online feeds of security videos—exposingthe private lives of customers—though it had made statements inits marketing that implied the feeds were safe.

“The type of consumer harm we saw in the TRENDnet case . . .
feeds concerns about the Internet of Things overall,” Federal
Trade Commissioner Maureen Ohlhausen told the U.S. Chamber
of Commerce shortly before the final settlement. But the FTC’s
“unique set of policy and enforcement tools” can help ensure new
technologies safely achieve their promise, she said.

THE INEVITABLE LET-DOWN
Beyond security, smart devices have other kinks that need working
out. In the short term, Io T is destined to disappoint, according to
Chad Davis, senior director of digital media at the National Association of Home Builders. “Right now the Internet of Things is hyped,”
Davis told attendees at the International Builders’ Show. As these
new products fail to live up to their promise of freeing consumers,
there’s bound to be a feeling of disillusionment, he says. Still, Io T is
here to stay. “This is a fundamental shift in what is going to happen
with our industry,” he said. Builders attending the show were cautioned by other speakers to watch the development of smart home
technology carefully, using the auto industry as a bellwether, and to
be cautious about where they hitch their proverbial wagons.

The hype will likely lead to oversaturation in the market, withcountless companies rolling out smart home o;erings. There’slittle agreement about which platforms to use and how—or evenwhether—devices should communicate with each other. “Noteveryone will survive,” says McCaughey. “You don’t want to pickthe Betamax provider for your home.”Kerley agrees that there are limitations due to the many com-peting systems but predicts that will begin to change soon. “2015will be the year where we have to make the call that there has tobe an open system,” she says. “Much like the web uses the samescripting language, that’s going to have to happen.”Regardless of bumps in the road ahead, early observers of Io Tare optimistic. “Our digital and physical worlds are converging,”Kerley says. She predicts that 75 years from now, historians willlook back at 2010–2025 as a time of exponential change. “We’regoing through a renaissance,” she says.

Learn about the opportunities for associations and MLSs in the
Internet of Things. [ realtorm.ag/iot-orgs]